Finance Minister Alfredo Thorne will resign.

PERU - In Brief 21 Jun 2017 by Roberto Abusada

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Finance Minister Alfredo Thorne will resign after Congress denied him a confidence vote he formally requested. His resignation comes as part of the fallout concerning the government efforts to revive the proposed airport project at Chinchero, Cuzco. The construction and operation PPP project was awarded in 2014 during president Humala´s government to an Argentinian-Peruvian consortium, Corporación América and Andino Investment Holding, under a contract considered by many as ill-conceived, because among other deficiencies, it did not specify a cap on the interest rate on a government-guarantee for the financing that the consortium was supposed to provide. The approval of an addendum to the original contract by the Ministry stirred a huge controversy that resulted in the resignation of Transport Minister Martin Vizcarra in order to avoid an almost certain impeachment and censure by Congress. But in a bizarre twist of events the Comptroller General, who was ready to issue a negative opinion on the addendum, taped a conversation with Minister Thorne. The audio surfaced on TV and was used by the Comptroller—who in turn was being accused of several misdeeds—to say he was being pressured by the Minister to issue a favorable report. Minister Thorne was called to Congress to answer on the taped conversation during a session in which most congress members demanded his resignation. We think President Kuczynski will name Prime Minister Fernando Zavala to replace Thorne at the Ministry of Finance, while remaining as Prime Minister at the same time. It is possible that the President´s decision is just a temporary solution to the current crisis, while he considers a further Cabinet r...